UK Government, Regulators to Examine Potential Risks from Cryptocurrencies

Britain’s government and regulators will look in detail at the potential risks from cryptocurrencies like bitcoin, British junior finance minister John Glen said on Monday.

Glen said there had been an “explosion of growth” in crypto assets like bitcoin, which might pose risks even though the underlying technology has immense potential.

“In our upcoming fintech strategy, the government will announce further work with the Financial Conduct Authority and the Bank of England to consider these issues in more detail,” Glen told the Innovate Finance conference.

Central bankers in Europe have called for regulation of bitcoin and initial coin offerings, or firms that raise funds by offering cryptocurrencies to investors.

But there is no global consensus on action. A meeting of central bankers and finance ministers from the Group of 20 Economies in Argentina on Monday and Tuesday is expected to agree only on more detailed monitoring rather than concrete action.

Britain is not expected to rush to impose draconian rules as it wants to remain a key financial technology, or fintech, center as European countries like France sense an opportunity to lure British firms when Britain leaves the European Union next year.

“The UK is the best place in the world for fintech and my mandate is to ensure it remains such,” Glen said.

“I hear rumblings across the Channel that [French] President Macron is looking to drag you all over to Paris,” Glen said.

“It’s a great city. Hop over on Eurostar and enjoy the weekend stocking up on croissants, and then come back to London on Monday morning and carry on making money and crack on as you have been.”

Britain’s fintech sector enjoyed a record year in 2017, with 1.3 billion pounds invested with over half the funding from abroad, and there was no desire to shift gears or resort to complacency, Glen said.

(Reporting by Huw Jones and Emma Rumney; editing by Edmund Blair)

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